For the first time in the muguka subsector, Kagace Muguka Farmer’s Cooperative Society has issued a dividend on shares of 5.2 per cent to its 315 members.
The cooperative, which brings together farmers in Kanothi and Gacegethiori villages in Mbeere South Sub-County Embu County, issued the dividend at the rate for the shares held, where minimum shareholding is 10 shares of Sh100.
The society’s founder and patron David Muriuki said the management resolved to issue the dividend based on the society's income in the last financial year in its audited accounts.
“This is the first time a muguka cooperative has issued a dividend and hopefully it has trail blazed for others. Muguka farming and trading are booming,” he said.
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Kagace Cooperative was formed in 2017 by 36 members, most of them parents of pupils at Kanothi Primary School, under the guidance of cooperative officials.
Muriuki who was the then Embu Commissioner for Cooperatives and also the chairman of Kanothi Primary School board was concerned that the parents defaulted in paying school fees yet they had an income from muguka farming.
He brought them together where they started contributing Sh300 weekly and would later qualify for loans to pay their school fees.
To become a member, one is required to pay Sh1,000 registration fee as share capital and to qualify for a loan, a member must have savings of at least Sh5,000.
“The initiative has grown into a stable cooperative that offers development loans, school fees loans and emergency loans. Membership has expanded to include other sectors such as salaried people,” states Muriuki.
Kagace Cooperative is among the 22 village cooperatives that started in a similar fashion and which form the umbrella Mbeerembu Miraa Cooperative Union.
The cooperatives, which range from those of muguka farmers, traders, drivers and transporters, pay Sh5,000 to join the union.
Among investments that Kagace Cooperative has is Sh1.5 million savings in a Money Market Fund in CIC Insurance and a prime plot in Kiritiri town where the cooperative is in the process of putting up its headquarters.
The society is led by a management committee of seven members and a supervisory committee of three members.
Muriuki reveals that Kagace Cooperative intends to acquire a loan from the Commodities Fund and use it to finance the construction of the headquarters, assist members to acquire water tanks, and partner with suppliers for the supply of muguka farming input.
The national government through Agriculture Chief Administrative Secretary Anne Nyagah has promised to offer loans for capacity building of miraa cooperatives at the rate of three per cent per annum.
Though castigated in some quarters for being a stimulant, muguka which is categorised by the government as a cash crop has led to a booming economy in the semi-arid Mbeere region of Embu County.
“Through the village cooperatives, we have seen improvement in members' livelihood where they are able to educate their children, meet emergencies such as medical and make other investments. Majority of the farmers have built permanent houses and others are doing business,” notes Muriuki.